Opinion
Index No. 654991/2019
08-06-2020
LAW FIRM OF ALEXANDER D. TRIPP, P.C., Plaintiff v. JOHN LEOPOLD FIORILLA, Defendant
NYSCEF DOC. NO. 50
DECISION AND ORDER
LUCY BILLINGS, J.S.C.:
Plaintiff law firm moves to dismiss the counterclaim by defendant former client of the firm for legal malpractice, based on his failure to allege a viable claim. C.P.L.R. § 3211(a)(7). The parties do not dispute that they entered two engagement agreements. The first, dated June 23, 2016, was for plaintiff to represent defendant in Citigroup Global Markets, Inc. v. Fiorilla, Index No. 653017/2013 (Sup. Ct. N.Y. Co.), in seeking to vacate a judgment that vacated an arbitration award in his favor. The second engagement agreement, dated September 18, 2016, was for plaintiff to represent defendant in the United States after he sought to enforce the award in France.
I. DEFENDANT'S COUNTERCLAIM
In the Citigroup Global Markets proceeding, Citigroup Global Markets moved for sanctions, including attorneys' fees, against both defendant and his attorney, plaintiff, August 4, 2017. Although by November 9, 2017, defendant had retained another attorney for this litigation, defendant alleges that plaintiff still represented him as well and on that date agreed with Citigroup Global Markets' attorney that its motion for sanctions raised no factual issues, obviating the need for an evidentiary hearing. Defendant claims that plaintiff's waiver of an evidentiary hearing was malpractice, because he did raise factual issues that would have been determined in his favor at a hearing and would have reduced the $213,832.50 award of sanctions, attorneys' fees, and expenses against him.
Specifically, defendant points to Citigroup Global Markets' chart in support of its motion for sanctions that listed the attorneys and paralegals who worked on the litigation, their hourly rates, and the number of hours spent. The chart included minimal information as to the timekeepers' experience and no details regarding how the timekeepers spent their time. Gordon v. Verizon Communications, Inc., 148 A.D.3d 146, 165 (1st Dep't 2017); Fairley v. Fairley, 136 A.D.3d 432, 433 (1st Dep't 2016); Matakov v. Kel-Tech Constr. Inc., 84 A.D.3d 677, 678 (1st Dep't 2011); Nager v. Teachers' Retirement Sys. of City of N.Y., 57 A.D.3d 389, 390 (1st Dep't 2008). See Deborah R. v. Dean E.H., 183 A.D.3d 500, 501 (1st Dep't 2020); Vogel v. Vogel, 172 A.D.3d 464, 465 (1st Dep't 2019); Sachs v. Adeli, 121 A.D.3d 490, 490-91 (1st Dep't 2014); Kudinovov v. Kel-Tech Constr. Inc., 112 A.D.3d 496, 496 (1st Dep't 2013). In fact, most of the documents that Citigroup Global Markets filed in the litigation over the period for which Citigroup Global Markets sought attorneys' fees were recycled documents from earlier in the litigation or routine documents easily prepared by a nonattorney and filed in any proceeding. JK Two LLC v. Garber, 171 A.D.3d 496, 496 (1st Dep't 2019); 542 E. 14th St. LLC v. Lee, 66 A.D.3d 18, 24 (1st Dep't 2009); Nager v. Teachers' Retirement Sys. of City of N.Y., 57 A.D.3d at 390. A hearing would have exposed the lack of support for the amount of attorneys' fees claimed. The closer question is whether defendant alleges that plaintiff represented him in waiving the hearing, since he had retained another attorney, and plaintiff still was defending itself against the motion that sought sanctions against plaintiff as well as defendant.
II. STANDARDS APPLICABLE TO PLAINTIFF'S MOTION
In evaluating plaintiff's motion to dismiss defendant's counterclaim under C.P.L.R. § 3211(a)(7), the court must accept defendant's allegations as true, liberally construe them, and draw all reasonable inferences in his favor. JF Capital Advisors, LLC v. Lightstone Group, LLC, 25 N.Y.3d 759, 764 (2015); Miglino v. Bally Total Fitness of Greater N.Y., Inc., 20 N.Y.3d 342, 351 (2013); ABN AMRO Bank, N.V. v. MBIA Inc., 17 N.Y.3d 208, 227 (2011); Drug Policy Alliance v. New York City Tax Comm'n, 131 A.D.3d 815, 816 (1st Dep't 2015). The court will not give such consideration, however, to allegations that consist of only bare legal conclusions. Simkin v. Blank, 19 N.Y.3d 46, 52 (2012); David v. Hack, 97 A.D.3d 437, 438 (1st Dep't 2012). Dismissal is warranted if the counterclaim fails to allege facts that fit within any cognizable legal theory. Faison v. Lewis, 25 N.Y.3d 220, 224 (2015); ABN AMRO Bank, N.V. v. MBIA Inc., 17 N.Y.3d at 227; Lawrence v. Graubard Miller, 11 N.Y.3d 588, 595 (2008); Nonnon v. City of New York, 9 N.Y.3d 825, 827 (2007). Although plaintiff may not rely on evidence outside the scope of the pleaded counterclaim, defendant may rely on admissible evidence to supplement his pleading. Nonnon v. City of New York, 9 N.Y.3d at 827; Cron v. Hargro Fabrics, 91 N.Y.2d 362, 366 (1998); US Suite LLC v. Barata, Baratta & Aidala LLP, 171 A.D.3d 551, 551 (1st Dep't 2019); Ray v. Ray, 108 A.D.3d 449, 452 (1st Dep't 2013).
III. DEFENDANT'S EVIDENCE
Defendant relies on the correspondence dated November 14, 2017, "on behalf of all parties," recounting that at a court appearance November 9, 2017, the court had scheduled an evidentiary hearing later in November, but that the parties had conferred afterward and agreed to forego an evidentiary hearing. Aff. of Bernard V. Kleinman Ex. 1, at 2. The "current counsel of record" "on behalf of all parties in this action" included Paul, Weiss, Rifkind, Wharton & Garrison LLP; Robert de By, defendant's new attorney; and plaintiff. Id. at 1. Thus, in referring to "current counsel," the correspondence includes plaintiff, which was not counsel to any party other than defendant. Although plaintiff was a respondent to the motion for sanctions along with defendant, the correspondence is on behalf of parties in the action, not parties to the motion. Plaintiff was not a party in the action; defendant was.
Defendant's counterclaim alleges that plaintiff represented defendant from "2016 through August 2017," but does not allege that plaintiff ceased representing him after August 2017. The context of this allegation is as a preface to the motion for sanctions: this period is the period for which Citigroup Global Markets sought sanctions, attorneys' fees, and expenses.
Although plaintiff presents documents that in September 2017 it opposed the motion only on the firm's behalf and not on defendant's behalf and that de By opposed the motion on defendant's behalf, these documents are outside the scope of pleaded counterclaim. Miglino v. Bally Total Fitness of Greater N.Y., Inc., 20 N.Y.3d at 351; Lawrence v. Graubard Miller, 11 N.Y.3d at 595; GEM Holdco, LLC v. Changing World Tech., L.P., 127 A.D.3d 598, 599 (1st Dep't 2015); Lee v. Dow Jones & Co., Inc., 121 A.D.3d 548, 549 (1st Dep't 2014). Plaintiff moved to dismiss defendant's counterclaim based on C.P.L.R. § 3211(a)(7), not § 3211a)(1). If plaintiff now seeks to rely on these documents, it may move for summary judgment. C.P.L.R. § 3212(b).
In any event, the fact that de By handled this component of the representation does not negate a co-counsel relationship and plaintiff's continued representation of defendant as the litigation proceeded. Nothing demonstrates that plaintiff withdrew from its representation of defendant between then and November 14, 2017. De By's notice of appearance is not a substitution of the attorney for defendant, but is simply another appearance on defendant's behalf.
IV. DEFENDANT'S VIABLE LEGAL THEORY
By alleging that plaintiff's choice to forego an evidentiary hearing was incompetent and unreasonable, because it was obvious that a hearing would successfully reduce the sanctions award and thus benefit plaintiff, defendant states a claim for plaintiff's professional negligence. Sejfuloski v. Michelstein & Assoc., PLLC, 137 A.D.2d 549, 549-50 (1st Dep't 2016); Tenasca Delgado v. Bretz & Coven, LLP, 109 A.D.3d 38, 43-44 (1st Dep't 2013). This alleged malpractice caused defendant's alleged damages in the form of an attorneys' fees award unreduced from the full amount Citigroup Global Markets claimed. Baram v. Person, 153 A.D.3d 1183, 1183 (1st Dep't 2017); Caso v. Miranda Sambursky Sloane Sklarin Ver Veniotis LLP, 150 A.D.3d 422, 423 (1st Dep't 2017); O'Neal v. Muchnick Golieb & Golieb, P.C., 149 A.D.3d at 636; Rubin v. Duncan, Fish & Vogel. L.L.P., 148 A.D.3d at 433. See Rudolf v. Shayne, Dachs, Stanisci, Corker & Sauer, 8 N.Y.3d 438, 442-43 (2007); Exeter Law Group v. Immortalana Inc., 158 A.D.3d 576, 577 (1st Dep't 2018); Macquarie Capital (USA) v. Morrison & Foerster LLP, 157 A.D.3d 456, 456-57 (1st Dep't 2018); Garnett v. Fox, Horan & Camerini, LLP, 82 A.D.3d 435, 435-36 (1st Dep't 2011).
V. CONCLUSION
Consequently, defendant sustains his legal malpractice counterclaim based on plaintiff's participation on his behalf in waiving an evidentiary hearing on Citigroup Global Markets' motion for sanctions. For the reasons explained above, the court denies plaintiff's motion to dismiss defendant's counterclaim. C.P.L.R. § 3211(a)(7). Within 10 days after entry of this order, plaintiff shall reply to the counterclaim. C.P.L.R. § 3211(f). The parties shall convene for a Compliance Conference August 20, 2020, at 4:00 p.m. via telephone, which the court will arrange in advance. This decision constitutes the court's order. DATED: August 6, 2020
/s/_________
LUCY BILLINGS, J.S.C.